Bridging Business & Healthcare : Healthcare Management Consultants for Dispute Resolution, Valuation & Clinical Compliance

This past week, Nevada’s state board of health found itself in the middle of an all too familiar debate – just how much information should hospitals be required to share directly with the public.  The debate arose over a new regulation that would require Nevada hospitals to report hospital acquired infections to the CDC’s infection database. That information would then be available to state regulators to track, trend, and respond to as needed.  The information would not, however, be available directly to the public. In leading the debate against full public disclosure, Bill Welch, the president of the Nevada Hospital Association, stated that although he was against allowing the public to identify which hospitals had which infections, he was in favor of “meaningful transparency.”
 
This debate over how much to share already has taken place in at least 27 other states. But as I read how others had solved this, I began to believe we aren’t looking for the right answer as much as we are asking the wrong question.
 
As an industry, healthcare is going through a transition in the realm of quality.  It is moving (or in some cases being moved) from only measuring processes of care – did the patient get an aspirin - to measuring outcomes of care – did the patient live or die?  Forces from within the industry, such as doctors Pronovost and Gawandi, and external forces as great as the new healthcare law itself are driving healthcare quickly toward this goal. While progress is being made, we are far from the end of this transition. 

Focusing on “how transparent we are” misses the point.  When we can focus on and achieve meaningful quality as demonstrated by consistently improved outcomes, debating over who sees the data won’t seem very meaningful at all.

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Recently, a friend of mine went out to his car late one night to run an errand, only to find that it would not start. He was immediately concerned as he had an early AM meeting that he couldn’t miss. He had just replaced the battery so knew it must be something else. Knowing nothing of cars, he did what any of us would do, he Googled it. One brief phrase – “Infiniti QX56 won’t start battery new”—and presto, up popped three online mechanics, one at $15, one at $25, and one at $45. Choosing the middle of the range, he clicked on the link and there was his trusty online mechanic at 11:30 PM to answer his questions and hopefully solve his dilemma. After a brief history of the problem, the mechanic quickly shared with him what he thought to be the most likely answer – it was a relay switch. Fortunate for him, this particular model has 6 other relays that are identical, one of which was to the fog lights. The fix was simple; he would just need to switch out the two parts. Knowing that my friend was not adept in the ways of car repair, the mechanic, e-mailed him a diagram of where to find the correct part, he switched it out, and like magic, his car started up. Thirty minutes after getting online – Problem solved.

As I thought about this story, it made me wonder about how we continue to care for patients today. My physician’s office is one of the very few places in my life that I have to wait for an appointment in order to receive the information I want or need. A friend of mine called last week for an appointment as a new patient with a specialist she needed to see. First available appointment – 6 weeks.

Much of the discussion we are seeing is about how physicians must change the way we practice in response to healthcare reform and the new law. Although that is undeniably true, there are other forces of change at work in the world of healthcare. Given that nearly everything else in our lives has become designed around immediate access, it is only a matter of time until physician practices must find a way to get on board. 

• New models of care, using social media tools and immediate access such as hellohealth are emerging. Follow @jayparkinson on twitter to see more.

• Jennifer Shyne Dyer, MD, [@endogoddess] is using texts and tweets to monitor her diabetic patients. 

• The Mayo Clinic recently launched its new Center for Social Media with the tagline Bringing the Social Media Revolution to Healthcare.  

If physicians are to survive and thrive in this new healthcare world, they will need to join in this “revolution,” developing new and creative ways to care for their patients and make information immediately available to them.  How long will it be till your patients are really able to see you…now?

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This past week, CMS announced a public comment period on several newly released quality metrics focused on stroke outcomes – 30-day all cause mortality and 30-day readmission rates. As I spend most of my day working on healthcare reform and quality, I spent the weekend diving into these metrics, wanting to be sure exactly which clinical improvements CMS was looking to incentivize physicians and hospitals to achieve. I quickly scrolled down through the 30-page “Measure Information Form,” looking to find the definition of the metric and why it was chosen. I had to go about 10 pages into the document, but there it was.  I came upon the section titled “Measure Justification” with the subtitle "Importance.” Under this impressive heading, CMS went on to say it would define this "Importance” by the "Extent to which the specific measure focus is important to making significant gains in healthcare quality (safety, timeliness, effectiveness, efficiency, equity, patient-centeredness) and improving health outcomes for a specific high impact aspect of healthcare where there is variation in or overall poor performance.” OK. Makes sense so far.

Not too much further into the document, CMS goes on to define the Summary of Evidence of High Impact. Perfect. This is just what I am looking for. Let’s see – Affects Large Numbers. I can buy that. Stroke affects almost 800,000 people every year in the U.S. Next. Leading Cause of Morbidity/Mortality. Stroke is the third leading cause of death in the U.S. after heart disease and cancer. Well said. CMS seems to be right on point. Next. Severity of Illness Stroke survivors frequently experience significant long term disability. And finally – High Resource Use. The estimated direct and indirect cost of cerebrovascular disease for 2010 is $73.7 billion. Hey, wait just a minute. I thought we were talking about improving clinical quality. How did this get in here?

When I was a young physician in training, we spent hours learning to read and interpret clinical studies, always keeping current on the latest trends to assure we were providing the best clinical care to our patients. It wasn’t that we were trained to ignore the cost of care, but we didn’t include it as we defined whether or not quality was improved. Quality was on one hand, cost on the other, and we weighed them together in our decision. Now it seems as if that line has become a bit blurred. 

In 2007, CMS released a report to Congress entitled “Plan to Implement a Medicare Hospital Value-Based Purchasing Program.” The report's goal is defined by moving more towards a value-based system of care as follows:

CMS recommends replacing the current quality reporting program with a new program that could include both public reporting and financial incentives for better performance as tools to drive improvements in clinical quality, patient-centeredness, and efficiency.

When you critically examine current demonstration projects, the trend continues. Right alongside of "Post-operative stroke” you will find "Average and median length of stay” both listed as metrics to measure quality.

When the definition of whether or not quality is achieved is dependent on the resources consumed, are we limiting our focus to only those outcomes that also provide financial savings? Has cost become the new sine qua non of quality? Maybe the new line isn’t that blurred after all….

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“I read the news today, oh boy"

The outlook for Medicare has improved substantially, or at least so say the Trustees of the Social Security and Medicare trust funds in their recently released report. According to this latest report, Medicare will now be solvent until at least 2029. The good news is, this is 12 years longer than previous estimates. The bad news is, I will only be 64 – 2 years short of eligibility for my full Medicare benefit. Paul McCartney's words – “Will you still need me, will you still feed me?" – suddenly have taken on a very personal meaning.

According to the report, this windfall for Medicare is entirely due to “...program changes made in the Patient Protection and Affordable Care Act.” It goes on to say that “If health care efficiency cannot be substantially improved through productivity gains or other measures, then over time the statutory Medicare payment rates would become inadequate.”

This new math is quite telling. With all the new programs and new ideas, why does health care reform only buy us 12 more years in an admittedly optimistic, best case scenario? For all of the talk about continuity and coordination, this plan is largely focused on gaining efficiencies in our current system. New models of payment do not necessarily equal new models of care. There are certainly opportunities to lower our costs, and improve our delivery, but there is a limit to the efficiency you can gain in any system. There is only so much juice in the proverbial orange. 

We are currently living in a system of uncoordinated sick care with the goal being to move to a system of coordinated health care. Although the new law moves us in that direction, it really only gets part of the way – to a coordinated sick care system. Unless we can continue to move toward a model of truly coordinated health care, we are simply delaying the inevitable. We may have a good start, but we still need a better plan.

Title: When I'm Sixty-Four, John Lennon & Paul McCartney

Opening Quote: A Day In the Life Lyrics, Paul McCartney

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PYA’s one-stop healthcare reform information website is getting great reviews in its debut at the American Health Lawyers Association conference in Seattle.

PYA ReformLoupe is our free, interactive website that continuously updates our firm’s healthcare alerts, news stories, blogs, social network sites and other Internet information while it idles on a computer desktop or mobile communications device. Users can also use ReformLoupe to search the hundreds of pages of the healthcare reform act (PPACA.)

Typical comments from Seattle are: “This is great. What’s the subscription fee?” When told there’s no cost to use it, the next question is, “For how long?”

The original idea was to do something that is quick and easily accessible for physicians, healthcare executives and others, like attorneys, whose primary professional interests are in healthcare. As our affiliates at Bluegill Creative were building and designing the site, we decided that journalists, bloggers or anyone else with an interest in healthcare reform might find it useful. We opened it up for everyone, and there really is no cost for using it.

Users can customize the flow of information they want to see, save their preferences for the next visit and search the summary of the federal healthcare reform law.

Look for posts from several of our staff, including Marty Brown, senior healthcare consulting shareholder; Mark Browne, MD, principal consultant and a former practicing physician and hospital executive; James Lloyd, shareholder and healthcare valuation specialist; and Carol Carden, a finance, valuation and managed care consulting shareholder.

After you’ve visited the site, let us know what you think and give us your suggestions on the Contact link.

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I read a few interesting articles regarding planned expansions by the nation’s largest retail pharmacies in Business Week and this one in Health Leaders. CVS, Walgreens and Wal-Mart have all announced plans to greatly expand their in-store clinics in anticipation of primary care shortages due to healthcare reform and the increase in the number of Americans with insurance coverage.

While the clinics themselves do not typically generate a profit, the additional foot traffic will likely improve profits for retail pharmacies resulting in increases in their value. It will be interesting to see if the regional and local pharmacies (to the extent these still exist) follow suit resulting in an overall upward movement in acquisition multiples for pharmacies across the nation.

For those of us involved in the healthcare valuation industry, we will need to keep this shift in operations and its potential impact on the valuation of not only pharmacies, but also on primary care practices in mind.

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